DOCUMENT RESUME ED 402 076 PS 024 852 TITLE The Apparel Industry and Codes of Conduct: A Solution to the International Child Labor Problem? INSTITUTION Bureau of International Labor Affairs(DOL), Washington, D.C. PUB DATE 96 NOTE 257p. AVAILABLE FROM International Child Labor Study Office, Bureau of International Affairs, U.S. Department of Labor, Room S-1308, 200 Constitution Avenue, NW, Washington, DC 20210; phone: 202-208-4843; fax: 202-219-4923; Internet: PUB TYPE Reports Research/Technical (143) Tests /Evaluation Instruments (160) EDRS PRICE MFO1 /PC11 Plus Postage. DESCRIPTORS Accountability; *Child Labor; *Codes of Ethics; *Fashion Industry; Imports; International Crimes; *International Trade IDENTIFIERS Monitoring ABSTRACT Corporate codes of conduct prohibiting the use of child labor are becoming more common as consumers areincreasingly calling upon companies to take responsibility for theconditions under which the goods they sell are manufactured.This report (the third volume in the Bureau of International Labor Affairs' international child labor series) details an investigation of the use of child labor in the production of apparel for the U.S. marketand the extent to which U.S. apparel importers have establishedand are using guidelines prohibiting the use of child labor. Resultsof a voluntary survey of 48 companies revealed that: (1)a majority have such a policy, although they have different forms andstandards; (2) that the transparency, or education and awareness, of thecodes among foreign contractors was not emphasized;(3) that most of the codes make no provision for implementation or monitoring; and(4) that most companies claimed they would enforce their codes, although they report having rare occasion to do so. Site visits by Departmentof Labor officials to six foreign countries confirmed the bulkof these results. Overall, codes of conduct, properly monitored andenforced, appeared to be a positive factor in solving the globalchild labor problem. Six appendices comprising over half of the reportcontain: (1) a list of companies surveyed;(2) the questionnaire; (3) the surveyed companies' codes of conduct;(4) site visit locations and contacts;(5) U.S. apparel imports, by region and country, 1985-1995; and (6) the International Labor Organization C138Minimun Age Convention, 1973. *********************************************************************** Reproductions supplied by EDRS are the best that can be made from the original document. *********************************************************************** U S DEPARTMENT OF EDUCATION P' Office of Ec-cational Research and Improvement EDUCATIONAL RESOURCES INFORMATION CENTER (ERIC) X:htscocument has been reproduced as eceivea trom tne person or organization originating it Minor changes have been made to improve reproduction quality Points of view or opinions statea in this document do not necessarily represent official OERI position or policy A 111 I I ' i I II I II 1, ID -8. mo ri ' ;. .00 A . 2 BEST COPY AVAILABLE OREL IIHEM COM 05' COBliO: A Solution to the International Child Labor Problem? U.S. Department of Labor Robert B. Reich, Secretary of Labor Bureau of International Labor Affairs Andrew J. Samet, Acting Deputy Under Secretary -- 1996 3 Acknowledgments This report was prepared under the direction of Andrew J. Samet, Acting Deputy Under Secretary for International Labor Affairs (ILAB). The writing, editing, research and coordination of the report was done by the staff of the International Child Labor Study Office, Sonia A. Rosen, Maureen Jaffe and Jorge Perez-Lopez, Director of ILAB's Office of International Economic Affairs. Other staff of the Bureau of International Labor Affairs, the Office of the Solicitor and the Office of Public Affairs who made major contributions include: Kelly W. Bryant II, Carrie Cyphert, Teresa Estrada-Berg, Marcia M. Eugenio, Maria Elena Gonzalez, Sudha K. Haley, Todd Howe, Lewis Karesh, Angelique Larsen, John Luther, Thelma Majette, Maria Elena Marquez, David Parker, Maureen Pettis, Gregory K. Schoepfle, James W. Shea, Daniel Solomon, Karen Travis, Ana Maria Valdes, Diane Ward, Robert D. Who ley, Andrew Yarrow, Melissa Yazman, and Bob Zachariasiewicz. In addition, Department of Labor officials received signifi- cant assistance from labor reporting officers and labor attaches in U.S. embassies and consulates abroad. This report is published by the U.S. Department of Labor, Bureau of International Affairs. Copies of this report or other reports in ILAB's child labor series, may be obtained by contacting the International Child Labor Study Office, Bureau of Interna- tional Affairs, U.S. Department of Labor, Rm. S-1308, 200 Constitution Ave., NW, Washington, DC 20210. Tel: (202) 208-4843; Fax: (202) 219-4923. The reports are available on the Internet via World-Wide Web: http: / /www.ilr.cornell.edu /library/ e_archive/ChildLabor/. [Excluding the Public Hearings] Other publications in ILAB's child labor series: 1. By The Sweat and Toil of Children (Volume I): The Use of Child Labor in U.S. Manufactured and Mined Imports (1994). 2. By The Sweat and Toil of Children (Volume II): The Use of Child Labor in U.S. Agricultural Imports & Forced and Bonded Child Labor (1995). 3. Forced Labor: The Prostitution of Children (1996) [Symposium Proceedings] 4. Public Hearings on International Child Labor (Proceedings) 1994 5. Public Hearings on International Child Labor (Proceedings) 1995 6. Public Hearings on International Child Labor (Proceedings) 1996 Table of Contents Executive Summary I. Introduction 1 A. Overview 1 B.International Child Labor 2 C.Child Labor in the Apparel Sector 4 D.Codes of Conduct: A Recent Innovation 8 II.Codes of Conduct in the U.S. Apparel Industry 11 A. Introduction 11 B. Corporate Codes of Conduct 12 1. Earlier Origins of Codes of Conduct 12 2.Rationale for Adopting Codes of Conduct 13 3.Extent of Usage of Codes of Conduct 14 C.The Apparel Industry 15 1. Structure of the Industry 15 2.United States Apparel Imports 19 a.Imports by Source 20 b.Imports by Type of Importer 20 3.Globalization and Working Conditions in Exporting Countries 22 D.Codes of Conduct of the Largest U.S. Retailers and Manufacturers of Apparel 22 1. Survey of U.S. Retailers and Manufacturers of Apparel 22 2.Survey Response 24 a.Manufacturers 25 b.Retailers 25 3.Survey Results 26 a.Manufacturers 26 b.Department Stores 27 c.Mass Merchandisers 28 d.Specialty Stores 29 e.Non-Store/Direct Apparel Marketers 30 E.Development of Apparel Industry Codes of Conduct 31 1.Form and Method of Development of Codes of Conduct 31 2.Basic Elements/Standards of Codes of Conduct 32 3.Definitions 35 a.Minimum Age 35 b.Additional Elements of the Child Labor Policies 39 F. Implementation of Apparel Industry Codes of Conduct 41 1. Implementation Challenges 41 a.Organization of Production 41 b.Streamlining of Supplier Base 42 c.Impact of Textile Import Restrictions 44 BEST COPY AVAILABLE 5 2.Transparency 45 a.Education/Communication 45 b.Transparency of Implementation Process 47 3.Monitoring 48 a.Monitoring of Codes of Conduct in the Apparel Industry 48 i. Models of Active Monitoring 50 Internal Monitoring 50 External Monitoring 50 Outside Audits 50 NGO Monitoring 53 ii.Active Monitoring 53 iii. Contractual Monitoring 60 b.Evaluation of Prospective Contractors 64 4.Enforcement 65 III. Implementation Experiences of Codes of Conduct in the U.S. Apparel Industry 71 A.Introduction 71 B.Field Visits 71 1. Planning of Field Visits 72 a.U.S. Apparel importers 72 b.Labor Organizations 72 c.Department of State 72 d.Foreign Governments 73 2.Conduct of Field Visits 73 3.Plant Visits 73 C.Child Labor in the Apparel Industry 80 D.Transparency 84 1. Foreign Suppliers' Awareness About Codes of Conduct 85 2.Training and Supplier Certification 88 3.Posting of Codes of Conduct 89 4.Workers' Awareness with Codes of Conduct 93 5.Dissemination of Codes of Conduct 96 E.Monitoring 99 1. Monitoring for Quality 99 a.Purpose of Monitoring 99 b.Previous Knowledge About Monitoring Visits 100 c.Pre-Contract Inspections 100 2.Monitoring for Codes of Conduct 101 a.Monitoring Methods 103 b.Active Monitoring 103 c.Contractual Monitoring 105 d.Contractual and Active Monitoring 106 3.Monitoring Procedures 107 F. Enforcement 108 1. Corrective Measures 108 2.Positive Reinforcement 110 IV. Conclusion 113 BEST COPY AVAILABLE 6 A.Child Labor in the Apparel Industry 113 B.Codes of Conduct in the U.S. Apparel Industry 114 C.Transparency of Codes of Conduct in the Apparel Industry 115 D.Monitoring and Enforcement of Codes of Conduct in the Apparel Industry 116 E.Recommendations 118 V.Appendices 121 Appendix A: List of Companies Surveyed 122 Appendix B:Company Questionnaire 123 Appendix C: Codes of Conduct Provided by Companies Surveyed 124 Appendix D: Site Visits 208 Appendix E: U.S. Apparel Imports, by Region and Country (1985-1995) 230 Appendix F: ILO Convention 138 235 BEST COPY AVAILABLE 7 EXECUTIVE SUMMARY A. Congressional Mandate This report is the third volume in ILAB's international child labor series.... It focuses on the use of child labor in the production of apparel forthe U.S. market, and reviews the extent to which U.S. apparel importers haveestablished and are implementing codes of conduct or other business guidelines prohibitingthe use of child labor in the production of the clothing they sell. The report wasmandated by the Omnibus Consolidated Rescissions and Appropriations Act of1996, P.L. 104-134. B. Overview A recent development, corporate codes of conduct and otherbusiness guide- lines prohibiting the use of child labor are becoming more common, as consumers as well as religious, labor and human rights groups are increasinglycalling upon com- panies to take responsibility for the conditions under whichthe goods they sell are being manufactured. Many U.S. companies that import apparel haveadopted codes of conduct that prohibit the use of child labor and promote other laborstandards. For purposes of this report, the term "codes of conduct" isused generically to refer to various types of corporate policies and standards onchild labor and other work- ing conditions.